Answer to Question #170579 in Microeconomics for James

Question

Suppose Lindsay and Taylor are doing Chemistry and Psychology homework. In one hour, Lindsay can solve 10 Chemistry questions and 0 Psychology questions, or 20 Psychology questions and 0 Chemistry questions. Taylor can solve 20 Chemistry questions and 0 Psychology questions, or 30 Psychology questions and 0 Chemistry questions. a. What is the opportunity cost of solving 1 Psychology question for Lindsay? What is the opportunity cost of solving 1 Psychology question for Taylor? 

Answer 1

let Lindsay be A

let Taylor Be B

let C denote Chemistry and

P denote Psychology

C P

A 10 0

0 20

the differences are 10c and 20 p Therefore for 1 p

$10/20$

=1/2

the opportunity cost of solving 1 Psychology question for Lindsay is 1/2

C P

B 20 0

0 30

the differences are 20c and 30 p Therefore for 1 p

$20/30$

= 2/3

the opportunity cost of solving 1 Psychology question for Taylor is 2/3